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Tuesday, June 09, 2009

"Not so fast with that Fiat, Mr. President!"

WSJ's Best of the Web Today comments on the Justice Ruth Bader Ginzburg temporary halt of the Fiat-Chrysler deal. Seems the quote below is quite accurate:

"In addition to the principle at stake, the Supreme Court has an institutional imperative to intervene in this case. The administration is attempting to seize power that rightly belongs to the courts (and to Congress, since lawmakers could rewrite the bankruptcy law if they chose). We have often criticized the Supreme Court for overstepping its power, but it would be just as wrong for the court to shirk its responsibility to exercise its power legitimately.

In response, Mauro [Legal Times reporter] notes, the administration and those who would benefit from its deal argue that too much is at stake to follow the law:

"Solicitor General Elena Kagan . . . defended the sale as the only feasible alternative to liquidation. If that happens, more than 38,000 jobs would be lost, she argued.The Official Committee of Unsecured Creditors also filed a response to the Indiana challenge to the Chrysler deal. The committee . . . argues that the sale of Chrysler, while "not perfect," stands as "the only alternative to a far worse economic and human disaster." The brief added that "the balance of harms tilts so overwhelmingly against a stay" that the Supreme Court should deny the stay for that reason alone.

The loss of 38,000 jobs is a "disaster"? Just yesterday we were reading that the loss of "just 345,000 jobs" last month was a sign of hope. In any case, this is ridiculous hyperbole. A company's failing is a hardship, maybe even a tragedy, but it is part of the ordinary functioning of an economy. A deadly hurricane or terrorist attack is a disaster. Further, prosperity depends on the rule of law. Widespread theft leads only to poverty, even if the thieves are elected politicians."